The boom is bust – Higher housing costs fewer births more deaths slow O.C. to a crawl – Home prices to blame

The boom is bust: Higher housing costs, fewer births, more deaths slow O.C. to a crawl

Orange County’s population growth is little more than a trickle these days, according to figures released this week by the U.S. Census Bureau.

Throughout most of the 1970s and ’80s, the ethnically diverse mass of people calling Orange County home ballooned by more than 2 percent annually. In 1975, more than 56,000 people were added, by birth or moving here – a 3.4 percent bump from the previous year.

But last year, population grew by just 23,600, less than 1 percent – the sixth-slowest rate in the past half-century of census data. The only years with less growth preceded the national economic recession.

The primary reasons, in Census Bureau parlance, are domestic migration patterns and deaths. In plain English, more people are leaving Orange County for other parts of the U.S. than are coming to live here. And our increasingly elder population is dying off faster than babies are being born.

Though the net change in migrants from other countries grew by 29 percent in 2014 from the previous year, much of that growth was wiped out by a domestic exodus. About 8,000 more residents left Orange County than new ones arrived here.

Home prices to blame

Urban planning and real estate experts said rising home prices may be partially to blame. Orange and Los Angeles counties both lost residents to domestic migration, while Riverside County, with cheaper housing options, continued rapid growth in 2014.

Orange County home prices have continued a steady climb in recent months, according to CoreLogic DataQuick figures, nearly reaching prerecession levels. In February, the median home price was about $571,000 in Orange County, compared with $305,000 in Riverside County.

“Even though there’s more construction, we still hear the issue of housing prices,” said Deborah Diep, director of the Center for Demographic Research at Cal State Fullerton. “It’s been a huge ongoing issue, not just for Orange County but for the whole Southern California region.”

The new data don’t spell out exactly where Orange County residents are moving and why they’re moving. More detailed data won’t be released until later this year.

Work here, live elsewhere

Wallace Walrod, a chief economic adviser for the Orange County Business Council, cautioned against drawing too many conclusions from the new report. Population estimates sometimes later are revised because of changes in the Census Bureau’s statistical methods.

But Walrod said the data match up with other economic trends. Noting that Orange County’s unemployment rates remain lower than other Southern California counties, he said more residents may be choosing to work in Orange County and live elsewhere.

“The No. 1 reason that people move is typically for jobs,” Walrod said. “But I think it is mostly about housing prices.”

Karen Edmonds, president of Fullerton-based Winkelmann Realty, said one of her clients, an out-of-state family with four children, recently was looking for a home in Fullerton on a $650,000 budget. It turned to Corona instead. Getting to work and other regional attractions would take longer, but the family also could find a bigger home for thousands less.

The last time Orange County’s annual population growth fell below 1 percent was before the national housing market collapsed. Median home prices skyrocketed then, peaking at $642,000 in August 2007.

Pressure for services

Whether population expands or shrinks might sound like a dry subject. But it influences how much federal funding flows in the county and gets fed into public policy debate and business decisions.

For example, more older residents will put greater pressure on some economic sectors, such as health care, while reducing demand for others like child care and schools.

Geographic shifts in residential population also can strain the transportation system – such as increasing the number of freeway commuters – and cut sales tax revenue that many government agencies rely on to fund core public services.

And as young adults decide to put off having a family – or move outside the county – that affects demand for home furnishings and various services. In a story last year, the Register reported that Orange County had added about 7,500 households a year since 1990, but average growth fell to 2,700 households a year from 2009 on.

“People tend to do most of their retail shopping close to where they live less than where they work,” Walrod said. “That’s the other thing we’re losing out on when people choose to still work in Orange County but live in Riverside or San Bernardino.”

With about 3.15 million residents, Orange County’s population is the third-largest in California – behind Los Angeles and San Diego counties – and larger than 22 states.

Deaths are up 11%

Stagnant birth rates and substantially more deaths also have pushed Orange County toward slower population growth in recent years, the new census data show.

Last year, the bureau estimated nearly 2,000 more deaths in the county than three years earlier, an 11 percent climb.

The trend follows previous census figures that show Orange County increasingly has become a home for people over 45. From 2000 to 2010, the number of residents ages 45 and older grew by 29 percent, while the number of younger residents fell by 4 percent.

The growing population of seniors presents new challenges for social service agencies aiming to cut health care costs. The county Office on Aging has programs that deliver meals to seniors and help seniors attend medical appointments in an effort to prevent them from entering managed care prematurely, said director Karen Roper.

“If you’re getting seniors to doctors and helping them remain healthy, people can stay at home,” Roper said. “The best quality of life is certainly not in skilled nursing (facilities). It’s extremely expensive and not the best place to age with dignity.”